US open: Stocks fall as Trump dampens hopes of any progress in trade talks

Wall Street stocks opened lower on Tuesday ahead of a fresh round of trade talks between Chinese and US officials in Shanghai.

As of 1530 BST, the Dow Jones Industrial Average was down 0.20% at 27,165.64, while the S&P 500 was 0.31% lower at 3,011.52 and the Nasdaq Composite had lost 0.35% to 8,264.38.

The Dow opened 55.71 points softer on Tuesday after seeing out Monday slightly higher as investors were looking ahead to today's trade talks and a major announcement from the Federal Reserve scheduled for Wednesday.

The latest round of US-China trade talks kicked off in Shanghai on Tuesday with the first face-to-face meetings between negotiators from both countries since the collapse of the negotiations in May.

On the US side, the talks were being led by trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin and by Vice-Premier Liu He and Commerce Minister Zhong Shanon on the Chinese side.

The meeting in Shanghai was organised after presidents Donald Trump and Xi Jinping agreed to a trade war truce at the G20 leaders' summit in Osaka only a month ago.

While both sides were seeking to play down expectations of a quick end to the trade war, Donald Trump further dampened any hopes that it would be possible after taking aim at China in a series of tweets.

On Tuesday morning in the US, the president said China was not keeping its promise of buying more US agricultural products and said the world's second-largest economy was "doing very badly". However, China insists it has, in fact, bought US agricultural products.

Looking forward to Wednesday, investors expect policymakers to announce a 0.25% rate cut on Wednesday and will also be keeping their ears to the ground in order to pick up any hints as to whether or not the central bank would signal more cuts for over the coming months.

In terms of corporate news, Merck's latest quarterly earnings and revenues beat expectations after sales of its cancer drug Keytruda surged 58% quarter-on-quarter, while Procter & Gamble picked up more than 4% to an all-time high following its own earnings beat.

Apple will post its latest quarterly figures after the close.

On the data front, US personal income and spending growth edged past forecasts in June, but price pressures were a tad more muted than anticipated by economists.

According to the Department of Commerce, personal income and spending grew at a month-on-month clip of 0.4% and 0.3%, respectively. Consensus had pegged growth in both at 0.3%.

At the core level, which excludes the often typical categories of food and energy, the PCE price deflator was up by 0.2% versus the month before and by 1.6% year-on-year.

Elsewhere, contracts to buy previously owned homes increased more than anticipated last month, according to the National Association of Realtors.

The NAR's report seemingly indicated that lower mortgage rates could be supporting the housing market, as its pending home sales index rose to a reading of 108.3 in June, up 2.8% from the prior month. May's index was unrevised at 105.4.

Lastly, a key measure of consumer sentiment rebounded this month, pointing to a certain amount of confidence about the US economy amongst Americans despite persistent trade tensions and slowing global growth.

The Conference Board's index of consumer confidence rose to 135.7 in July, up from the 124.3 recorded in June.